Schroders shares smash two-year high after surge in new business
Wealth manager Schroders notched a two-year high on its stock price on Thursday morning after an influx of new business led to a major uptick in management fees.
The FTSE 100 asset manager told markets it was expecting full-year operating profit to come in at £745m, up from £603m from the year prior.
Shares rose nine per cent on the news to 453.40p.
Schroders eyed net income for the year at £2.6bn, up from £2.4bn the year prior, after management fees were boosted from a surge in assets under management and new business.
Costs, meanwhile, are expected to be broadly flat year-on-year after reaching £1.8bn last year.
The firm said it “remain committed” to our transformation target of £150m annualised net savings by the end of 2027.
Schroders’ cost-income ratio – a key metric showing how much is spent on costs for each pound generated – ticked down to 71 per cent, marking a boost as it tumbled from 75 per cent the year prior.
Assets under management, including joint ventures, swelled to £825bn after an inflow of near £11bn in new business.
Schroders’ new management delivering at speed
“Schroders has been very clear about what the new management team was trying to achieve: reinvigorate growth through a focus on what was good within the business; clear out marginal businesses acquired previously; address materially the cost base; and reset its relationship with the market,” analysts at Panmure Liberum said.
“Today’s unscheduled trading update shows clear progress on all fronts, well ahead of the market’s expectations. The market has been grudging, at best, in accepting the change and the rating has certainly not anticipated the speed with which new management has delivered.”
Earlier this year, banking giant Lloyds snapped up the remaining 49.9 per cent stake of Schroders Personal Wealth (SPW), taking full control of the previously joint venture.
SPW, which will be rebranded as Lloyds Wealth, was set up in 2019 in partnership with Lloyds, and supports £17bn assets under administration and 60,000 clients.
It delivered an operating profit of £45m in the first half of 2025, and expects operating costs to exceed full year guidance of £9.7bn.
Oliver Gregson, chief executive of wealth management at Schroders said the announcement “represents a meaningful step in reshaping our business and focusing on our strategic ambition.”